Pioneer reports lower profit ahead of its takeover by Exxon

(Reuters) – Pioneer Natural Resources on Thursday reported a lower first-quarter profit, weighed down by higher production costs and weak natural gas prices.

Earlier in the day, the U.S. Federal Trade Commission gave the go-ahead to Exxon Mobil’s $60 billion purchase of the company, but barred Pioneer’s former CEO, Scott Sheffield, from joining Exxon’s board on allegations he attempted to collude with OPEC to raise oil prices.

Sheffield retired as Pioneer’s CEO on Dec. 31, but continues to serve on its board and was due to take a seat on Exxon’s board when the acquisition closed.

Exxon said it plans to close the all-stock deal on Friday, bolstering the largest U.S. oil company’s production in the Permian Basin. Pioneer shareholders approved the merger in February, with a majority voting in favor of the deal.

Pioneer saw average realized prices of $76.86 per barrel of oil in the quarter, up 2.3% from a year earlier, but average realized prices for gas declined 51% to $1.87 per thousand cubic feet (mcf).

Costs associated with oil and gas production rose about 31%.

Net income attributable to common shareholders for the three months ended March 31 was $1.1 billion, or $4.57 per share, compared with net income of $1.2 billion, or $5 per share, a year earlier.

(Reporting by Mrinalika Roy in Bengaluru; Editing by Anil D’Silva)